E-mini Futures Push Toward Records as Powell Hints at Flexibility

E-mini S&P (September) / E-mini NQ (September)

S&P, yesterday’s close: Settled at 6146.25, up 69.25

NQ, yesterday’s close: Settled at 22,412.75, up 339.25

E-mini S&P and E-mini NQ futures closed within 2% of a record high. That said, the QQQ ETF is on the one-inch line of its record, set on February 19th. Better-than-expected PMIs on Monday, semiconductor tailwinds, and the Iran-Israel ceasefire have all been a tailwind from Monday’s intraday low. Yesterday’s tape was certainly interesting, and we have often seen some give-back intraday after such a strong overnight. Although this may have been the case on Fed Chair Powell’s hawkish prepared speech for his Congressional Testimony, he hinted at flexibility during his questioning. The CME’s FedWatch Tool only shows a 20.7% probability of a 25bps cut at the July meeting, up from 12.5% one week ago when the Chair was direct and spoke of being cautious and patient in the timing of a policy adjustment at his FOMC press conference. He testifies before Congress again today, beginning at 9:00 am CT.

Build Permits are due at 7:30 am CT, New Home Sales at 9:00 am CT, and a 5-year Note auction at noon CT.

Price action is firm ahead of the opening bell, with both the E-mini S&P and E-mini NQ holding out above their Pivot and point of balance, detailed below. Some back and fill would make sense, however, a sense of animal spirits is being rendered, given the proximity to record highs. We have resistance levels detailed below with 6178.50 in the E-mini S&P not only being the February 24th high, but also the 100% extension of the range from yesterday’s early high at 2:00 am CT, in the intraday low of 6009. A move out above this level will continue to feed a gravitational pull higher with our next major three-star resistance coming in at….